Shareholders of Housing Development Finance Corporation (HDFC) have given their approval to merge HDFC Ltd and HDFC Bank, according to a communique by HDFC to National Company Law Tribunal (NCLT), reported Moneycontrol.
The counsel of the two companies informed the NCLT that the merger has been approved by shareholders with an overwhelming majority and no objections were received on the merger.
Earlier, the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), the Pension Fund Regulatory and Development Authority (PFRDA), and the Competition Commission of India (CCI) have all given HDFC the necessary clearances for the merger, the report said.
After the complete deal and merger, existing shareholders of HDFC will own 41 per cent of the HDFC bank.
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At the time, Deepak Parekh, chairman of HDFC in a press statement said, “This is a merger of equals. We believe that the housing finance business is poised to grow in leaps and bounds due to the implementation of RERA, infrastructure status to the housing sector, government initiatives like affordable housing for all, amongst others. Over the last few years, various regulations for banks and NBFCs have been harmonised, thereby enabling the potential merger. Further, the resulting larger balance sheet would allow underwriting of large ticket infrastructure loans, accelerate the pace of credit growth in the economy, boost affordable housing and increase the quantum of credit to the priority sector, including credit to the agriculture sector.”
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Announced in April 2022, the merger of HDFC and HDFC Bank is expected to be completed by the second or third quarter of FY24. According to HDFC, the proposed transaction will enable HDFC Bank to build its housing loan portfolio and enhance its existing customer base.